Avio S.p.A. (AVIO) AI Stock Analysis

• Market Cap: €875.89M
• Dividend Yield: 0.44%
• Average Volume (3M): 258.64K
• Price to Earnings (P/E): 139.5
• Beta (1Y): 0.54
• Revenue Growth: 38.67%
• EPS Growth: -6.16%
• Country: IT
• Employees: 1,352
• Sector: Industrials
• Sector Strength: 85
• Industry: Aerospace & Defense
• EPS (TTM): N/A
• Shares Outstanding: 27,159,346
• 10 Day Avg. Volume: 362,285
• 30 Day Avg. Volume: 258,638
• PEG Ratio: -7.50
• Price to Book (P/B): 1.16
• Price to Sales (P/S): 0.73
• P/FCF Ratio: 13.99
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: €30.50
• Price Target Upside: -9.23% Downside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 61 Neutral
• Price Target: €36.00 ▲(7.14% Upside)

Avio S.p.A.'s stock score is primarily influenced by its stable financial performance, despite challenges in revenue growth and cash flow fluctuations. Technical analysis indicates strong bullish momentum, but overbought signals suggest caution. The high P/E ratio and low dividend yield reflect potential overvaluation, impacting the overall attractiveness of the stock.

Positive Factors

Growth Potential

Analyst has improved 2025-27 revenue, adjusted EBITDA, and adjusted net profit forecasts for Avio by significant percentages, indicating growth potential.

Order Backlog

The order book reached a new record of €1,724mn, exceeding both our forecast of €1,550mn and the guidance range of €1,500mn to €1,600mn thanks to the orders signed in December.

Strategic Positioning

Avio offers a unique opportunity in the space and missile niche in the European arena, leading to a convinced BUY recommendation.

Negative Factors

Cash Position

Net cash position is expected to deteriorate following the normal seasonality of the business.

Valuation

Following the recent stock rally, the current valuation fairly captures the company’s short-medium term prospects.

Avio S.p.A. Business Overview & Revenue Model

Company Description

Avio S.p.A. is an Italian aerospace company specializing in the design, development, and production of propulsion systems for space launch vehicles and satellite systems. The company operates primarily in the aerospace and defense sectors, providing advanced technologies and solutions for space exploration and satellite deployment. Avio is known for its expertise in solid rocket motors, liquid propulsion systems, and space launch services, contributing significantly to various European space missions.

How the Company Makes Money

Avio generates revenue through multiple streams, primarily from contracts with governmental space agencies, commercial satellite operators, and international partnerships. Key revenue sources include the production of propulsion systems for the Ariane and Vega launch vehicles, as well as ongoing contracts for satellite launch services. The company benefits from significant collaborations, particularly with the European Space Agency (ESA) and the Italian Space Agency (ASI), which provide funding and support for various projects. Additionally, Avio's focus on innovation and technology development allows it to participate in emerging markets such as small satellite launches and reusable launch systems, further diversifying its revenue potential.

Avio S.p.A. Financial Statement Overview

Summary

Avio S.p.A. shows a sound financial position with strong balance sheet metrics and efficient cost management. Despite challenges in revenue growth and fluctuating free cash flow growth, the company's financial health remains stable, indicating potential for enhanced profitability and cash flow stability.

Income Statement

Avio S.p.A. shows a mixed performance in its income statement. The company faced a significant revenue contraction from 2023 to 2024, indicating challenges in sales growth. However, the gross profit margin remains robust, suggesting effective cost management. The net profit margin is relatively modest, reflecting pressures on profitability despite improvements in EBIT and EBITDA margins, which indicate better operational efficiency.

Balance Sheet

Avio maintains a solid balance sheet with a low debt-to-equity ratio, highlighting prudent financial leverage. The equity ratio is strong, indicating a stable capital structure with significant shareholder equity. Return on Equity (ROE) is moderate, reflecting stable, albeit not exceptional, profitability relative to equity.

Cash Flow

Cash flow analysis reveals moderate strength with positive free cash flow and growth in operating cash flow. However, free cash flow growth rate shows fluctuations, signaling potential cash management issues. The company effectively converts operating cash flow into net income, showcasing good cash flow management relative to earnings.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	483.99M	343.70M	73.22M	324.14M	206.11M
Gross Profit	130.03M	113.89M	72.40M	96.64M	105.57M
EBITDA	25.83M	22.41M	21.45M	30.15M	35.34M
Net Income	6.09M	6.49M	-435.00K	8.48M	14.12M
Balance Sheet
Total Assets	1.09B	1.06B	1.29B	1.24B	1.12B
Cash, Cash Equivalents and Short-Term Investments	101.68M	95.59M	131.40M	104.61M	124.67M
Total Debt	11.59M	19.46M	56.95M	47.45M	62.03M
Total Liabilities	779.52M	744.75M	982.10M	926.12M	810.48M
Stockholders Equity	302.83M	300.62M	293.66M	302.48M	303.48M
Cash Flow
Free Cash Flow	25.10M	6.14M	33.22M	7.54M	12.80M
Operating Cash Flow	60.26M	42.48M	65.74M	41.26M	47.40M
Investing Cash Flow	-35.16M	-38.85M	-34.23M	-33.71M	-34.60M
Financing Cash Flow	-19.01M	-39.44M	-4.72M	-27.59M	-32.44M

Avio S.p.A. Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 33.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IT:AVIO, the sentiment is Positive. The current price of 33.6 is above the 20-day moving average (MA) of 29.10, above the 50-day MA of 24.88, and above the 200-day MA of 18.24, indicating a bullish trend. The MACD of 2.75 indicates Negative momentum. The RSI at 74.50 is Negative, neither overbought nor oversold. The STOCH value of 68.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IT:AVIO.

Avio S.p.A. Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LDO	68 Neutral	€26.41B	25.23	12.10%	1.13%	14.13%	5.99%
Sector *	66 Neutral	€3.18B	23.11	6.98%	2.61%	-1.64%	-21.22%
FCT	66 Neutral	€5.49B	42.37	14.30%	―	18.44%	―
AVIO	61 Neutral	€875.89M	139.48	2.02%	0.44%	38.67%	-6.16%